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Auckland City councillors recommended scrapping local recycling on Waiheke and disqualifying the local contractor amid angry protests from islanders yesterday.

The recommendation, by a majority on the city development committee, is expected to be confirmed at a meeting of the full council today.

A delegation of 50 Waiheke residents interjected with cries of "shame" and "rubbish" as councillors voted to recommend awarding a $21.4 million, 10-year rubbish and recycling contract to Australian-owned Transpacific Industries.

The same majority voted to disqualify the existing contractor, Clean Stream Waiheke, after independent auditor John Walton said the company had broken tender rules by emailing City Vision councillors.

Mr Walton said tenderers for the contract knew they were supposed to use a single point of contact at the city.

Clean Stream's emails to councillors had been designed to influence the outcome of the tender process, he said.

He thought City Vision councillors should also be excluded from taking part in the process today as they had also received emails. They have yet to decide what to do.

City Vision leader Richard Northey said councillors on the centre-left ticket had raised concerns on behalf of Waiheke residents because they were unable to raise them through their elected representative.

Hauraki Gulf Islands councillor Denise Roche could not take part in the tender process because her partner, John Stansfield, is the executive director of Clean Stream Waiheke.

Mr Northey said the islanders should be allowed to keep their existing recycling system as they had indicated they were willing to pay the difference between Clean Stream's bid and Transpacific's cheaper one.

That would require the council to contribute towards the cost of a new transfer station on the island, he said.

Transpacific Industries has $2.5 billion in long-term debt and its shares have been suspended from trading in Australia since February.

Yesterday, councillors on the majority Citizens and Ratepayers ticket decided to recommend awarding the contract to the company after it announced it had a new cornerstone shareholder that would contribute 62 per cent of the $800 million needed to improve its debt position.

City Vision councillor Cathy Casey withdrew from taking further part in the tender process after Mr Walton said she had acted inappropriately by replying to emails and appearing to advise Waiheke groups favouring the local company.

Mr Stansfield has said that he "absolutely rejects" the allegation of canvassing.